East and Southern Africa Container Trades – spectacular East Africa growth, struggling Southern Africa

Since 2011, Dynamar has been surveying the container trades connecting East Africa, Southern Africa and the Indian Ocean Islands (ESAf). The latest of these biennial studies has just been released, and, as the report’s author Darron Wadey writes, what is noticeable over this period is the increasing influence of East Africa and relative decline of Southern Africa.

East Africa’s coastline comes from Kenya, Tanzania and the Indian Ocean aspect of Somalia. It also incorporates the landlocked countries of Burundi, Ethiopia, Malawi, Rwanda, South Sudan, Uganda and Tanzania. The eastern regions of the Democratic Republic of Congo, could also be considered part of the East African hinterland.

The bedrock of East Africa’s growth has been its economy, which has been growing at much faster rates than the consolidated economy of those countries in Southern Africa. From 2011 to 2023, it is projected that East Africa’s economy will have grown from USD 203 billion to USD 447 billion, an average growth each year of 6.8% (compound annual rate). Following a dip over 2011-2015, the regional Southern Africa economy will only have recovered back to its start point of USD 509 billion.

Whilst much of Southern Africa’s economic struggles can be pinpointed to the country of South Africa – to which exchange rates will also play a role – there is no denying the economic development that has taken place in East Africa. A similar theme of East African growth and Southern Africa stagnation (or worse) is also reflected in how these coastlines are served by the container liner carriers.

Looking at Annual Trade Capacity (ATC), a measurement used by Dynamar to analyse and model specific trade lanes, the provision of container shipping capacity to East Africa has grown by 5.4% each year on average from 813,000 TEU in 2011 to more than 1.5 million TEU come 2023. Southern Africa, has actually experienced a decline from over 2.3 million TEU to a touch above 2.0 million TEU.

Looking forward, there is no major reason at this moment in time to believe that these trends will change. Just by looking at GDP, the IMF forecasts that come 2027, East Africa’s regional economy will have continued to improve and reach USD 624 billion. It will actually overtake that of Southern Africa which, despite also growing, will then be some USD 31 billion smaller than that of East Africa.?

Based upon this projection and the historical relationships between GDP and Annual Trade Capacity (ATC), East Africa could continue to close the gap and end up with a share of 39% of all ATC. Back in 2011, it started with a 23% share. At the same time, Southern Africa’s share is expected to fall to 47%. This will merely confirm another notable development from the 2023 survey, namely that Southern Africa had lost its absolute majority position; in 2021 it started with 65%.

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The above was based upon data drawn from the 2023 edition of the East and Southern Africa Container Trades, an in-depth study produced by Dynamar once every two years.?

The study analyses each specific trade lane, the carriers providing the services and the ports called. Annual Trade Capacity (ATC) analyses covers each of these elements and even combines some, such as which carriers deploy the most trade capacity to which ports in any given trade.?

At a wider level, each carrier is profiled with a summary of their (historical) involvement in the ESAf trades and allocation of ATC along them. Port developments are also summarised, together with how much ATC they receive by trade or carrier. Other chapters provide an overview of how national and coastline economies, populations and general merchandise trade has evolved plus what the main commodities are moving in and out.?